Reconciling the Green Accounts

摘要

In an optimally managed economy, green national expenditure is equal to the linearization of the Hamiltonian from the problem of maximizing discounted social utility. Herein, we utilize the adjoint conditions to add to the basis for viewing green NNP as an index of social utility under ideal conditions and to show the equality of net national income and expenditure. The results apply even when returns to scale are increasing or decreasing. Unpriced, net environmental benefits should be incorporated into comprehensive NNP in much the same way as the disutility of labor. Otherwise, current practices of the national accounts can be defended, including the treatment of capital gains.